Figure 8-2
The vertical distance between points C and D represents a tax in the market.

-Refer to Figure 8-2. The loss of producer surplus associated with some sellers dropping out of the market as a result of the tax is
A)$6.
B)$4.
C)$8.
D)$12.

Question

Figure 8-2
The vertical distance between points C and D represents a tax in the market.
​  ​
​
​
​
-Refer to Figure 8-2. The loss of producer surplus associated with some sellers dropping out of the market as a result of the tax is
A)$6. 
B)$4. 
C)$8. 
D)$12.

Quizplus · Accepted Answer

The loss of producer surplus due to some sellers dropping out of the market is represented by the area of the triangle formed between the supply curve and the price after tax. This area is $4.

Figure 8-2 the Vertical Distance Between Points C and D Represents a Represents